Brazil infrastructure: The way ahead

Investors remain skeptical that Brazil’s concession program for financing much-needed infrastructure projects will succeed where past attempts have failed

By Thierry Ogier

For as many years as poor infrastructure has been a drag on
Brazil’s growth potential, authorities have sought
to find solutions for it.

The latest such attempt, launched amid much fanfare over a
year ago, set out to address the main bottlenecks in order to
boost the competitiveness of the region’s largest
economy.

But so far, the Programa de Investimentos em
Logística (PIL), as the concession scheme is known, has
barely got off the ground. The program has suffered delays due
to regulatory concerns and uncertainty over the availability of
financing.

Brazilian government officials nevertheless express
confidence — perhaps unsurprisingly — that
this time is different. The 180 billion real concession program
aims to invest in roads and railways, ports and airports over
five years.

A series of auctions are scheduled through next July. Large
pension funds and public-sector banks will be able to support
the winning consortia...